Embattled AZ chief: Bigger R&D bets, megadeals not the answer
AstraZeneca ($AZN) has been in a race against time to fuel its pipeline with new drugs as its big-selling meds face generics competition, and some of the London-based drugmaker's investors have become antsy with calls for change at the highest levels of the organization. But AstraZeneca CEO David Brennan appears to be sticking to his guns, telling Bloomberg that he's undeterred by those challenging his leadership at the embattled company.
"I'm plugged in, my role hasn't changed a bit," Brennan told Bloomberg during the annual Pharmaceutical Research and Manufacturers of America meeting in Boston. "I read and hear and see lots of things, but we're here trying to change policy, make good decisions and execute our strategy."
Yet according to a Financial Times report earlier this week, some investors aren't too happy about the state of affairs over at AZ. The company has suffered a string of setbacks in clinical trials and delivered among the industry's worst returns on R&D dollars invested in recent years. Nevertheless, Brennan believes that the company won't quell the problems with a major merger or a steep increase in research spending. He and R&D chief Martin Mackay have touted a plan to make smaller acquisitions in the near term to build the pipeline.
Last week, AZ announced a partnership with Amgen ($AMGN) on inflammatory disease drugs that even Mackay acknowledged wasn't going to fix the problems at his company, Bloomberg reported. A series of deals appears to be in the offing, yet such bolt-on transactions are popular among big biopharmas and competition for the deals will be fierce.
"If it's about restructuring, we can do that without a big deal," Brennan told the news service. "Maybe somebody sees something different, but spending more money does not have a linear increase in the number of returns you get from a research and development perspective."
- get more in the Bloomberg article